The parent company of Moben kitchens and Dolphin bathrooms has applied to go
into administration, becoming the latest victim of the slowdown on the high
street and the moribund housing market.

Homeform, owned by Sun Capital Partners, the American private equity firm, filed an "intention to appoint administrators" with the courts on Thursday afternoon.

Over 1,300 jobs are at risk and it is understood that 30 of the 160 showrooms were closed yesterday afternoon with immediate effect. The staff were told on a conference call by Peter Welsh, the operations director.

Those that worked at the 30 axed showrooms have lost their jobs, while those that remain with the company might not be paid their wages for June, sources at the company said.

It is unclear what will happen to the money of many hundreds of customers who have put down a deposit for a new Moben kitchen or Dolphin bathroom. If they paid for it by credit card sums up to £30,000 should be protected under consumer protection laws.

It is understood that the Sun Capital Partners hopes to arrange a pre-pack administration, shutting down or selling off Dolphin and Moben, and keeping hold of Kitchens Direct and Sharps, the bedroom retailer, after writing off the debts of the company. Staff at showrooms have been told to tear down all signs and posters for Dolphin and Moben by the end of business on Thursday.

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The branches that have been shut include Croydon, Brighton and Muswell Hill in north London.

The company's statement said: "The Board of Homeform Group Limited have today (Thursday 23 June 2011) filed with the Court a Notice Of Intention to Appoint an Administrator. This process can take up to ten working days.

"At present, the Homeform Group remains under the control of its Directors.

"The Directors are close to securing a deal that will safeguard the future of the Sharps (Bedrooms) and Kitchen Direct businesses and have mandated advisers to seek a sale of the Moben and Dolphin brands. Further information will be provided in due course."

This is the latest in a long line of consumer companies to be hit by the consumer slowdown, including MFI and Auto Windscreens.

Nick Bubb, retail analyst at Arden Partners, said: "It was a disaster waiting to happen for some time. All big ticket item retailers are struggling, from Dixons downwards. It is tough, especially if you are mass market."

Homeform's latest accounts, filed at Companies House, indicate that the company made a pre-tax loss of £6.05 million in the year to March 2010, on a turnover of £151 million. It had debts of nearly £23 million falling within one year.

Though Friday, June 24, is a so-called "quarter day", the traditional time retailers pay their landlords, this is not the main reason why the company felt forced to act. The deterioration in consumer confidence, caused by the squeeze in workers' salaries, has caused many shoppers to shy away from committing to big purchases, especially new bathrooms and kitchens. This led to a sharp drop in sales over recent months.

The situation has been exacerbated by a moribund housing market. According the Land Registry housing transactions in April were 14 per cent lower than twelve months ago.

This is not the first time Homeform has hit the buffers. Sun Capital itself bought the company out administration in 2007.

A spokesman for Sun European Partners, its UK arm of the business, which also owns ScS furniture stores, said: "Unfortunately, the Company’s performance was severely impacted by the rising levels of unemployment in the UK and a very difficult housing market – all factors leading to a steep and continued decline in consumer demand."